“Factors supporting economic growth in the region are the continuing US recovery, lower energy prices and still-plentiful liquidity in financial markets,” it said.

“We do not expect weakening of some credit metrics so far this year to be material enough to trigger sovereign downgrades,” Standard & Poor’s credit analyst Kim Eng Tan said today.

In its mid-year review of the Asia-Pacific region, S&P has retained India’s sovereign at ‘BBB-‘ with stable outlook as originally mentioned in its report in September 2014.

S&P had projected India’s credit outlook as stable for the next 24 months, saying “the new government has both willingness and capacity to implement reforms necessary to restore some of India’s lost growth potential, consolidate its fiscal accounts, and permit the Reserve Bank of India to carry out effective monetary policy”.

It had further said it could raise the rating if the economy reverts to a real per capita GDP trend growth of 5.5 per cent per year, and fiscal, external, or inflation metrics improve.

Conversely, it had said, “we may lower the rating if the government’s structural reform agenda stalls such that economic growth does not accelerate, or fiscal and debt ratios fail to improve”.

Referring to developments in China, it said the continuing slowdown and its struggle with asset deflation, and euro zone uncertainties weigh on Asia-Pacific’s growth prospects.